Fixing wildcat well a risky game

By Jennifer Hiller :
April 20, 2013
: Updated: April 21, 2013 1:52am

Mario Gonzalez (left) and Ricky Chavarria with Mercer Well Services work to improve an unproductive well on the Tortuga Ranch in Zavala County.

Photo By Jerry Lara / San Antonio Express-News

David Holdsworth owns the ranch, whose history with oil has been spottier than others tied to the Eagle Ford Shale.

Photo By Jerry Lara/San Antonio Express-News

Mario Gonzalez, 27, of Alice, Texas, helps out with blowout prevention equipment on a work over rig at the Tortuga Ranch in Zavala County, Wednesday, March 20, 2013.

Photo By Jerry Lara/San Antonio Express-News

Amid blooming huisache, landowner David Holdsworth, left, and wildcatter, Harvey Howell search for Well No. 3, an old non-producing gas well on Holdsworth's Tortuga Ranch in Zavala County, Saturday, March 2, 2013. Howell had scheduled a work over job on low producing Well No. 7 and the start of drilling on Well No. 8 for later on in the month.

Photo By Jerry Lara/San Antonio Express-News

Tortuga Ranch owner David Holdsworth checks out the No. 3 well on his land in Zavala County, Saturday, March 2, 2013. The well was drilled by wildcatter Harvey Howell and produced natural gas but no money. Holdsworth's land sits on the edge of the Eagle Ford Shale play. He has contracted the deep mineral rights with a Chesapeake Energy Corp. but has reserved the shallow rights for Howell.

Photo By Jerry Lara/San Antonio Express-News

Wildcatter Harvey Howell, left, and Tortuga Ranch owner David Holdsworth check out what remains of the No. 2 well on HoldsworthÕs land in Zavala County, Saturday, March 2, 2013. Howell has drilled several sites on the ranch. The first one produced only water but the No. 2 paid off with 25,000 barrels of oil. Holdsworth, a cattle rancher, was able to cut back on working the ranch and spend time with his new bride, Tamara. "I didn't have to run so many cattle. I used to have vicious cycles," Holdsworth said. "When Harvey drilled that it really helped Tamara and me." Holdsworth take on the deal was a quarter of the barrels.

Photo By Jerry Lara/San Antonio Express-News

Surrounded by dust kicked up by swirling winds, Ruben Naranjo, Jr. 32, of C & S Wireline Services, lines up a logging and perforating truck at the David Holdsworth Lease Well No. 7 on the Tortuga Ranch in Zavala County, Monday, March 26, 2013. The crew was at the site to perforate the well after a work over job by Mercer Well Services. The No. 7 well was producing too much water and the hope of the work over job was to perforate the casing at a spot that would yield a better oil-to-water ratio.

Photo By San Antonio Express-News

Casing is lined up by the Mercer Well Services crew working at the David Holdsworth Lease Well No. 7 site on the Tortuga Ranch in Zavala County, Wednesday, March 20, 2013. The well was undergoing a work over job by the crew. The casing was removed and the crew reworked the hole with mud and cement in order to perforate the well at a higher level. The perforations needed to be raised to avoid water from entering the well. Before the recomplete, the well was producing more water than oil.

Photo By Jerry Lara/San Antonio Express-News

Sonny Sanchez, 60, right, tool pusher with Mercer Well Service, hands company man Jim Wilson, a field ticket detailing the daily operations cost of the workover rig on the David Holdsworth Lease No. 7 well at the Tortuga Ranch in Zavala County, Wednesday, March 20, 2013. The workover crews works on a day rate. "Without the John Henry of Mr. Wilson here, I'm not getting paid."

Photo By Jerry Lara/San Antonio Express-News

Stainless steel plugs mark the charges on a perforating gun used to perforate the David Holdsworth Lease No. 7 well in Zavala County, Monday, March 26, 2013.

Photo By Jerry Lara/San Antonio Express-News

Company man Jim Wilson examines well logs before narrowing the area to perforate at the David Holdsworth Lease No. 7 well in Zavala County, Monday, March 26, 2013.

Photo By Jerry Lara/San Antonio Express-News

Crew member Mario Gonzalez cleans up the area around the David Holdsworth Lease No. 7 well as a recomplete job wraps in Zavala County, Wednesday, March 27, 2013.

Photo By Jerry Lara/San Antonio Express-News

The crew from left, Sonny Sanchez, Mario Gonzalez, Ricky Chavarria, George Garcia and Robert Torrez pose by the completed a work over rig No. 7 at the Tortuga Ranch in Zavala County, Wednesday, March 27, 2013.

Photo By Jerry Lara/San Antonio Express-News

Tortuga Ranch owner David Holdsworth and wildcatter Harvey Howell check out the future No. 8 drilling site in Zavala County, Saturday, March 2, 2013. The rig was scheduled to start a few weeks later. Upon further review of data, Howell decided to move the drill site about 200 feet southeast of this location.

More Information

ZAVALA COUNTY — Harvey Howell trails carefully behind David Holdsworth, who details the ways his vast ranch can stick the unsuspecting.

Holdsworth lists a number of cactuses and twisting brush: tasajillo, mesquite, prickly pear, the aptly-named allthorn.

A tall wooden stake stands in the tangle, looking out of place, but marking a potential oil well.

“We're going to get something this next time, aren't we?” Holdsworth asks, touching the stake as if for luck.

His land is hobbled by drought, but on this Saturday in early March, spring emerges anyway and Holdsworth's Tortuga Ranch reveals a stark beauty. The perfume of blackbrush acacia sweetens the air. Puffs of gold decorate huisache shrubs. Pink prickly poppy and purple prairie verbena bloom.

“Darn right,” Howell says.

Early settlers in Zavala County told tales of lost and buried treasure, but today's riches lie thousands of feet below ground. Holdsworth and his family own miles of mesquite — more than 14,000 acres — but he wants oil. So does Howell, a San Antonio geologist and wildcatter who hunts hydrocarbons in places no one else has found them or in depleted fields where others think oil is already gone.

Howell is coming off a recent dry hole in Frio County. And not far from this stake on Holdsworth's property sits a $600,000 wildcat well that isn't making money. It's producing just five barrels of oil per day and 50 barrels of briny water, which costs hundreds of dollars daily to dispose of.

Trying to fix the well will cost Howell and his investors $77,000 this month.

It might not work.

Marginal wells are financially prickly. It's easy to drop more good money down a bad well.

And Howell must start drilling new wells quickly or the mineral lease that lets him explore the historic ranch will expire. Howell needs a success, and he must stake his next spot in the brush carefully or get stung.

“You have to really want to be here,” Howell says as he plucks an inch-long thorn from his cowboy boot.

'Dedgum country'

Holdsworth's then 8-year-old grandfather arrived in Zavala County in the spring of 1882, a wet year that produced a sea of wildflowers.

It was a time before barbed wire fences enclosed local ranches, when cleansing wildfires kept the countryside a savannah that ran with perennial streams. Thick mesquite and thorny brush did not yet blanket the landscape.

But Holdsworth's family soon struggled with drought and poverty in what one of his ancestors came to call “this dedgum country.” For a while, they lived in a tent.

Cattle ranching eventually lifted the family's fortunes. Oil and gas production starting in the 1960s helped, too, although it was never a bonanza.

Holdsworth's property includes the Indio Field, drilled while he was growing up. But those wells dried up in the 1980s. A different oil boom came and went in the '90s in South Texas, bypassing Tortuga Ranch.

In the oil field, it's easy to be so close but so far away.

Not far to the southwest, a map of oil and gas wells in Zavala and Dimmit counties reveals a slew of riches — deep, horizontal wells slashing under the landscape through formations such as the Austin Chalk, Buda Limestone and Eagle Ford Shale, now one of the most profitable oil fields in the country.

But the oil and gas history of Tortuga Ranch and others nearby look spottier, with successful wells mostly surrounded by a series of dry holes.

Howell has poked around here for a decade trying to solve the riddle of its underground volcanoes, called serpentine plugs, and a web of faults that can trap and hold oil but also make it maddening to find what's still there.

One side of a fault is like hitting the lottery; a few yards away yields heartbreak.

Eroding confidence

The first well produced only water.

But the second paid, producing about 25,000 barrels of oil.

A quarter of that oil went to Holdsworth when he really needed it. He didn't have to work his land so hard or truck cattle himself to the Midwest. Holdsworth could spend more time with his new bride Tamara, whom he met at a dance in Uvalde while she was working on a master's degree in range ecology and fire behavior.

“I didn't have to run so many cattle. I used to have a vicious cycle,” Holdsworth says. “When Harvey drilled that, it really helped Tamara and me.”

When the oil first came in, Holdsworth rubbed it on his arms and face in delight. He got sunburned.

But after that, Howell and Holdsworth's luck ran dry.

“I've been eroding his confidence ever since,” Holdsworth says.

After the men walk to the No. 3 well, which produced some natural gas but no money, Holdsworth turns a wheel and releases the 215 pounds of pressure. The methane gas smells like a kitchen stove for a moment and turns the air wavy. A hollow whistle emerges from the Earth, but soon stops.

Holdsworth calls it the “sad-story well.”

When the No. 4 and No. 5 wells also turned into sad stories, “that's about the time everyone got disgusted and had had enough,” Howell says.

The investors lost interest. His original lease expired.

Shallow rights

Then the Eagle Ford Shale boom began.

The formation starts around 6,000 feet down in Zavala County, the northern edge of the giant oil and gas field.

National and multinational companies dominate the South Texas oil patch these days, but they don't lease everything. There are always pockets for smaller, longtime wildcatters like Howell to make deals.

Nearly three years ago, Holdsworth leased the rights to drill the Eagle Ford on his property to Oklahoma-based Chesapeake Energy Corp. Holdsworth received a large bonus payment for the right to drill, and an Eagle Ford well on the ranch last year made more than 46,000 barrels of oil, a quarter of that going to Holdsworth.

But large landowners can use the weight of their acreage as a negotiating tool.

Holdsworth's mineral lease reserved the shallow drilling rights so that Howell could return and try his luck again in rock formations that lie above the shale, such as the San Miguel and Olmos sandstones.

He bets that Howell will be the operator who sticks around and provides a longer stream of income to help keep his legacy ranch intact for the future.

Chesapeake wants to sell its “northern block,” which includes Tortuga Ranch, and concentrate on its more profitable Eagle Ford acreage to the south.

“Chesapeake is just dawdling. Here Harvey has been trying to do something forever,” Holdsworth says. “I've just got to admire him for his tenacity.”

By March 19, a workover rig, which is used to restore a well's production, moves in to try to fix the marginal well, bringing with it an evening cool front. The change in weather has so many rattlesnakes moving across the ranch roads that Holdsworth loses count.

Wednesday, March 20

Deeply buried oil and gas move higher over time, pushing their way to the surface.

Ryan Broglie, an engineer in San Antonio working on the project, says the technically complex well recompletion, called a “squeeze,” is straightforward in concept.

“Believe it or not, it's really as simple as oil floating on water,” Broglie says. The squeeze will essentially seal off the lower part of the well where the water enters, but let the higher oil through.

That's the theory, but the oil patch is a place of nonstop troubleshooting. “You can get into a very complex situation where you get things stuck and broken down there, and you're miles below the surface of the Earth,” Broglie says. “You need to have an amazing ability to visualize what's going on down hole.”

Today, a pin either comes loose or wasn't set, and 17,000 pounds of pipe suddenly drops down a 3,600-foot hole.

The top part of the pipe sits 580 feet down.

The workover crew starts “fishing,” an unhappy word.

“These become biblical terms because people curse about them,” Howell says. Things tend to fall into holes, and anything that does is a “fish” that must be retrieved. Sometimes the fish is small, like a wrench. Today it is big: the entire tubing string. “Right now, we need to be fishers of tubing.”

This will cost a day of work and more money.

The crew simply needs to lower more pipe into the well, thread it to the lost strand and pull it all back up. But they don't have enough pipe left at the surface to reach down 580 feet.

Jim Wilson, the company man who monitors the site, starts making calls. Everyone wants to sell more pipe than he needs, though, so it takes six tries to get the needed amount delivered.

Almost as soon as they fish successfully, Sonny Sanchez, a tool pusher, or drilling crew leader, comes to Wilson with more bad news.

The crew that's supposed to pressure test the well has left a key piece of equipment in another truck, in another county. They also forgot hardhats.

“This is what the oil field is made of: setbacks,” Sanchez said. “We have another setback.”

Wilson presses his lips together and nods. “Nothing to do but shut down.” It's just 2:30 p.m., and the engines exhale a long hiss as they let off pressure. Birdsong emerges from the brush.

Sanchez brings Wilson a field ticket, which details the daily operations cost. “I really like this part of my job, charging the customer,” Sanchez says. “Without the John Henry of Mr. Wilson here, I'm not getting paid.”

Friday, March 22

Late yesterday, a crew pumped cement down and around the well to seal off the lower portion. Now the rig needs to drill back through some of the cement, but it's still “green” and hasn't set.

At 12:30 p.m., Wilson calls Broglie to decide whether they should wait a few hours or give the cement the weekend to harden.

“Probably ought to shut down and come back Monday,” Wilson says. “We could come back in the morning but then you're going to maybe be faced with the same thing.”

Sanchez gives hand signals to his crew and makes a slashing motion across his throat. They're done today.

After 32 days in the field, they have a weekend off. It's payday, and Sanchez calculates that in two weeks the driller earned $4,200, the derrick man $4,000 and the floor hand $3,800, minus taxes.

Wilson will return to Austin to spend time with his daughter. The crew will try their luck at the casino in Eagle Pass, about an hour to the west. Everyone wants to leave Tortuga Ranch but Sanchez.

In 1999, his oldest son, Robert, was killed in an oil field accident.

Sanchez has lost more people in recent years: another son and a grandson, and his younger brother, who died last year of a heart attack. He likes working. Working keeps him from thinking.

Drilling rigs run 24 hours a day, seven days a week. But workover rigs are daylight operations, sunup to sundown.

“If it was up to me, I'd put up some light towers and work three or four hours after that,” Sanchez says.

A 'nasty' lease

Some mineral owners sign what's known as a Producer's 88, a common lease that gives oil and gas operators wide latitude to do what they want, when they want.

Not Holdsworth.

His mineral lease restricts drilling during deer hunting season. There are fines for litter. Fines for driving faster than 20 mph. Fines for not drilling after all. Essentially, 40-plus pages of fines and rules.

Holdsworth has watched oil field workers tromp across his land since he was a child. He roughnecked in the early '80s. He knows what can go wrong.

He calls his lease “nasty.”

“I knew he was a good fellow,” Holdsworth says of Howell. “If I made him live up to that lease, he wouldn't be able to do anything.”

“It's a toxic lease. It's awful,” Howell says. “I had to work on a handshake. I said, 'All right, I'll trust you.' We're still trusting each other. He still has an awful lease.”

Howell's investors have to trust him, too.

Howell's stepfather, C.R. “Bob” Daubert, is one of them. He met Howell's mother on a ski trip, and they married in 1979.

Daubert, also a geologist, calls the marginal well “a real problem child.”

“It's been terrible. When it first came in, we thought we had the tiger by the tail. Harvey brought a sample of the oil in a jar to the house. We started drinking wine in the middle of the afternoon.”

Now, Howell's position is as thorny as the countryside.

“He can't plug a well that's productive. But you can squeeze and screw it up,” Daubert says. “There are no cinches in the oil business.”

Monday, March 25

After the unwanted weekend off, Sanchez is the most cheerful person on site. He pocketed more than $1,500 at the Eagle Pass casino over the weekend. The guys on his crew lost money, which Sanchez attributes to their lack of technique on slots. “You've got to stay on one machine.” He thinks he will hit the lotto someday.

A partner in the project, Mike Deodati, sits in his maroon truck, parked at the edge of the location — his preferred spot, where he silently watches the rig like it's a particularly interesting TV show. Some days, he never says a word to anyone, no one the wiser that he's the operator responsible for filing permits with the state, doling out payments and running the business of this prospect from behind a pair of sunglasses and a straw cowboy hat.

Howell is jovial, but Deodati's quiet, a former accountant who likes logistics — figuring out how to drill a well in a suburban neighborhood or in the middle of a lake. He hopes they make a well.

Sanchez stands by Deodati's open window and tells him about a spot near Alice where the grass is greener than on surrounding ranches.

He helped plug wells there when he was 20 years old, though they held oil at the time. Sanchez is 60 now. “I never understood why they plugged it,” he says. “Think of what the pressure would be 40 years later.”

“I'll talk to you, Sonny,” Deodati says, and he gets a business card.

Wednesday, March 27

By 3 p.m., the rig is folded up like a giant umbrella and parked on a corner of the site. Trucks load up and drive away. Sanchez helps secure the blowout preventer to a trailer. Clouds stack up against each other in a fine, impenetrable layer, and Holdsworth ducks his head as the wind blows dust across the site. It looks like it could rain, but doesn't.

Instead, spilled oil stains the ground and puddles near the pumpjack. Holdsworth combs the ground for trash. “I'm always on these roughnecks. You'll see me poking my head around the rig at midnight.”

He gingerly steps to the edge of a drilling pit and uses a stick to fish out a wrench. He finds sticky bits of black electrical tape. “I am a clean fanatic for this ranch. My family worked damned hard for this.”

Holdsworth's phone keeps ringing. Someone calls about a water line for the next well. A ranch employee has a trailer with a flat tire.

The pumpjack returns to bobbing. It sounds like it's in its death throes, shuddering and rattling with every rotation. Holdsworth doesn't think it will last the night, but it does.

In a few days, the well gradually starts producing more oil and less water, a few barrels at a time. First five barrels. Then eight. Then 11.

But Tortuga Ranch needs another well, and a good one. Or, Holdsworth worries, this game is over. He thinks Howell will be snakebit, his investors again disgusted with the complex geology beneath the ranch.

“We've got one dance,” Holdsworth says. “That's all we've got out of this.”

More thorny brush has been cleared.

A drilling rig arrives in three days, and Holdsworth grows anxious.

jhiller@express-news.net

Twitter: @Jennifer_Hiller

Sources for this report include “Historical Notes on Zavala County, Texas and the Story of a Pioneer Family” by Ernest Holdsworth, the Texas State Historical Association, the Texas Railroad Commission, geologic maps and drilling reports.